Russel Metals (RUS) AI Stock Analysis

• Market Cap: $2.26B
• Dividend Yield: 4.02%
• Average Volume (3M): 161.96K
• Price to Earnings (P/E): 13.9
• Beta (1Y): 1.10
• Revenue Growth: 5.82%
• EPS Growth: -15.76%
• Country: CA
• Employees: 3,970
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Distribution
• EPS (TTM): 1.07
• Shares Outstanding: 56,000,000
• 10 Day Avg. Volume: 174,071
• 30 Day Avg. Volume: 161,958
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.22
• Enterprise Value/Revenue: 0.61
• Enterprise Value/Gross Profit: 3.25
• Enterprise Value/Ebitda: 8.39
• 1Y Price Target: $51.60
• Price Target Upside: 22.40% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 73 Outperform
• Price Target: C$46.00 ▲(9.11% Upside)

Russel Metals receives a solid score due to its strong earnings performance and reasonable valuation. The company's stable financial health and attractive dividend yield further support the score. However, challenges in cash flow growth and potential margin pressures in the upcoming quarter slightly temper the overall outlook.

Positive Factors

Strong Financial Performance

Russel Metals' robust financial performance in Q2 2025, with significant increases in revenue, EBITDA, and EPS, highlights its ability to enhance profitability and operational efficiency, supporting long-term growth prospects.

Market Share Gains

Achieving near-record shipments indicates Russel Metals' successful market penetration and competitive positioning, which can lead to sustained revenue growth and improved profitability over time.

Strong Liquidity Position

Russel Metals' strong liquidity position, with extended debt maturities, enhances financial stability and flexibility, allowing the company to invest in growth opportunities and weather economic fluctuations.

Negative Factors

Expected Margin Pressure

The anticipated margin pressure in Q3 suggests potential challenges in maintaining profitability, which could impact cash flow and financial performance if not managed effectively.

Tariff and Quota Uncertainty

Uncertainty around tariffs and quotas poses a risk to Russel Metals' operations and profitability, as it may lead to cost fluctuations and affect competitive positioning in key markets.

Negative Cash Flow Growth

Negative free cash flow growth indicates potential cash generation challenges, which could limit Russel Metals' ability to invest in growth initiatives and return capital to shareholders if not addressed.

Russel Metals Business Overview & Revenue Model

Company Description

Russel Metals Inc. is one of the largest metals distribution and processing companies in North America, primarily engaged in the distribution of steel and other metal products. The company operates through various segments, including Steel Service Centers, Energy Sector, and Industrial Products, offering a wide range of products such as carbon steel, stainless steel, aluminum, and specialty metals. Russel Metals serves a diverse clientele across multiple industries, including construction, manufacturing, and energy, providing both standard and customized metal solutions.

How the Company Makes Money

Russel Metals generates revenue primarily through the sale of metal products and related services. The company operates a network of service centers that stock a variety of metal products, enabling it to fulfill customer orders efficiently. Key revenue streams include the sale of carbon steel, stainless steel, and aluminum products, along with processing services such as cutting, shearing, and fabrication. Additionally, Russel Metals benefits from long-term contracts and relationships with major customers in the energy and industrial sectors, providing a stable revenue base. The company's strategic acquisitions and partnerships with suppliers also enhance its market position and contribute to its earnings.

Russel Metals Financial Statement Overview

Summary

Russel Metals presents a stable financial position with moderate profitability and efficient cash generation. While the company shows slight revenue growth and a decrease in free cash flow, its strong balance sheet and profitability metrics indicate a solid financial foundation. The leverage is well-managed, and the company is capable of converting income into cash effectively, positioning it well for future growth opportunities.

Income Statement

The company's gross profit margin for TTM is approximately 15.81%, and the net profit margin is around 3.53%. Both margins are indicative of moderate profitability. The revenue growth rate over the past year is 2.64%, showing a slight increase, but still lower than the growth seen in previous years. EBIT and EBITDA margins are at 4.96% and 7.07%, respectively, reflecting stable operating efficiency. Overall, the income statement exhibits decent profitability with room for improvement in revenue growth.

Balance Sheet

Russel Metals maintains a healthy balance sheet with a debt-to-equity ratio of 0.29, indicating a conservative leverage position. The return on equity (ROE) for TTM stands at approximately 9.35%, reflecting satisfactory profitability from equity. The equity ratio is about 60.89%, highlighting a solid equity base. The balance sheet reflects strong financial health with manageable debt levels.

Cash Flow

The TTM free cash flow growth rate is negative at -9.41%, indicating a decrease in free cash flow compared to the previous year. However, the operating cash flow to net income ratio is quite robust at 2.11, suggesting strong cash generation relative to net income. The free cash flow to net income ratio is 1.49, showing good cash flow conversion. Overall, the cash flow statement demonstrates solid cash generation capabilities, albeit with recent declines in free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.51B	4.26B	4.51B	5.07B	4.21B	2.69B
Gross Profit	845.40M	889.90M	956.50M	1.13B	1.21B	518.70M
EBITDA	328.00M	315.50M	428.20M	580.40M	657.90M	125.20M
Net Income	164.80M	161.00M	266.70M	371.90M	432.20M	24.50M
Balance Sheet
Total Assets	2.63B	2.35B	2.57B	2.51B	2.31B	1.60B
Cash, Cash Equivalents and Short-Term Investments	194.50M	45.60M	629.20M	363.00M	133.10M	26.30M
Total Debt	474.60M	196.80M	422.50M	422.90M	404.30M	399.40M
Total Liabilities	1.02B	688.30M	930.20M	947.60M	1.07B	731.60M
Stockholders Equity	1.61B	1.66B	1.64B	1.56B	1.25B	864.70M
Cash Flow
Free Cash Flow	216.90M	253.70M	389.00M	318.40M	275.70M	346.10M
Operating Cash Flow	304.10M	343.90M	461.70M	359.90M	304.50M	371.00M
Investing Cash Flow	-414.30M	-417.70M	-5.30M	-6.50M	-107.20M	-27.30M
Financing Cash Flow	-82.50M	-537.90M	-184.90M	-139.10M	-93.50M	-327.10M

Russel Metals Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 42.16
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:RUS, the sentiment is Positive. The current price of 42.16 is above the 20-day moving average (MA) of 41.39, above the 50-day MA of 41.21, and above the 200-day MA of 40.77, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 60.10 is Neutral, neither overbought nor oversold. The STOCH value of 88.24 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:RUS.

Russel Metals Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MTL	―	C$1.25B	13.20	9.33%	5.85%	5.53%	-21.87%
TIH	―	C$12.77B	26.35	16.70%	1.27%	6.99%	-5.58%
RUS	―	$2.26B	13.95	9.90%	4.02%	5.82%	-15.76%
WJX	―	C$498.64M	13.75	6.93%	5.69%	2.19%	-48.80%
FTT	―	C$9.77B	20.91	18.07%	1.62%	2.36%	0.62%
ARE	―	C$1.80B	70.80	2.78%	2.77%	20.53%	74.96%
Sector *	―	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Russel Metals Corporate Events

Russel Metals Expands US Presence with Kloeckner Acquisition

Russel Metals Inc. has announced an agreement to acquire seven service center locations from Kloeckner Metals Corporation for approximately US$118.6 million. This acquisition is expected to enhance Russel’s geographic footprint in the US South and Midwest, aligning with its long-term growth strategy. The transaction will increase Russel’s revenue base in the US to over 50% and is anticipated to provide operational benefits through improved inventory management and facility upgrades. The deal is expected to close by Q4 2025 or Q1 2026, subject to customary conditions.

The most recent analyst rating on (TSE:RUS) stock is a Buy with a C$48.00 price target. To see the full list of analyst forecasts on Russel Metals stock, see the TSE:RUS Stock Forecast page.

Russel Metals Streamlines Western Canadian Operations for Efficiency

Russel Metals Inc. has announced rationalization initiatives in its Western Canadian operations to reduce excess capacity and improve operational efficiency. These initiatives include selling real estate in Delta and Saskatoon, closing the Delta location, and relocating equipment, aiming for a cumulative invested capital reduction of approximately $100 million, enhancing the company’s financial position and operational focus.

The most recent analyst rating on (TSE:RUS) stock is a Buy with a C$46.00 price target. To see the full list of analyst forecasts on Russel Metals stock, see the TSE:RUS Stock Forecast page.

Russel Metals Reports Strong Q2 with Cautious Optimism

Russel Metals’ recent earnings call conveyed a generally positive sentiment, underscored by robust financial performance and strategic growth initiatives. The company reported significant improvements in revenue, EBITDA, and return on invested capital, reflecting a strong U.S. platform and a solid liquidity position. However, there were notes of caution regarding potential margin pressures in the upcoming quarter, uncertainties around tariffs, and expected seasonal slowdowns, which tempered the overall optimism.

Russel Metals Reports Strong Q2 2025 Performance

Russel Metals Inc., one of North America’s largest metals distribution companies, operates in the metals service centers, energy field stores, and steel distributors segments, with a focus on value-added processing.

Russel Metals Reports Strong Q2 2025 Results with Revenue Growth and Operational Improvements

Russel Metals Inc. reported strong financial results for the second quarter of 2025, with revenues reaching $1.2 billion, marking a 3% increase from the previous quarter. The company achieved its highest revenue level since mid-2022, driven by favorable market conditions, higher metal prices, and improved margins. The EBITDA rose by 26% to $108 million, and earnings per share increased by 43% to $1.07. The company also completed key operational improvements, including the integration of former Samuel branches into its ERP system, and enhanced its financial flexibility by extending its bank debt facility.

The most recent analyst rating on (TSE:RUS) stock is a Buy with a C$47.00 price target. To see the full list of analyst forecasts on Russel Metals stock, see the TSE:RUS Stock Forecast page.